Farm Land Values & Configuration

The 'farmability' or 'configuration' of a farm has a great deal to do with its value.  The last two Mays in Iowa have been unusually wet.  There have only been short windows of opportunity to plant in.  The amount of rainfall coupled with the intervals between rains left many fields unplanted in 2013.

Even in 2014, when most farmers got their crop in the ground, many had to switch to shorter season corn (read: lower yield) or beans.  Beans can be planted later, but often expensive fertilizer has been applied to match corn's needs, and was wasted on the beans.  Beans are generally less profitable than corn.  Also, when a farmer has to change planting varieties 'in season' the costs are much higher than the preseason sales.  Tax implications also hurt farmers who are prevented from planting when they like.  Insurance 'markers' may be adversely affected, also.   In all, if a farmer can't plant the crop he wants, when he wants to, it can hurt financially.

So what?

When a farmer considers a field, the shape of the field, and not only the soil type, has become a more important factor.  Couple this with larger equipment, and the irregular field borders create work and time loss for the farmer.

If the field is a perfect rectangle, or a few adjacent rectangles, this is optimum configuration.

If the field has angles, that is not so good.

If the field has irregular borders, that is bad.

This can be most vividly illustrated by a recent, North Iowa Auction.  There were two parcels which were very close to each other.  One had a low CSR (Corn Suitability Rating) and one had a high CSR.  The one with the low CSR was comprised of two adjacent rectangles.  The one with good soil types had an irregular, drainage ditch angling across the farm, cutting it into two parcels.  It also had another irregular acreage to farm around.

The poor quality farm brought over $140 per CSR point.  The 'good' farm brought about $90 per CSR point.

Lesson:  Don't set your sights on any land record auction prices if the farm is irregular!

And, don't create irregular borders when dividing off acreages for separate sale.